Homeowners and the officers, directors and management personnel of a homeowners association frequently have a need to review and understand the provisions contained in their HOA governing documents, and in particular, their associations Covenants, Conditions and Restrictions (commonly referred to as the CC&Rs). The CC&Rs are lengthy documents that have been prepared by lawyers and tend to contain much confusing language that the average lay person has difficulty understanding. Additionally, even when language is understood, it is not uncommon to come across conflicts in the language that is contained in different governing documents and/or between provisions that are contained in the associations governing documents and provisions that are contained in state statutes covering the same topic. To facilitate an understanding of confusing and/or conflicting language contained in an associations governing documents, there are established rules of interpretation that should be applied.

Confusion between HOA Governing Documents and Statutes.

State and federal laws or statutes that cover a topic that is the subject of HOA governing documents will contain language that informs the reader of whether or not the language in the statute was intended by the legislators to override the provisions that may be contained in the associations governing documents. When the language in the statute contains words such as notwithstanding any provision of the governing documents to the contrary or no governing documents shall (or similar language), the language contained in the statute is intended to override the language in the associations governing documents. Use of the word shall in a statute also reflects the intention for a provision in a statute to override a similar provision in an associations governing documents.

Statutes that were drafted with the intention of allowing associations to impose different provisions on a given topic will contain words such as Unless the declaration otherwise provides or Unless the governing documents impose more stringent standards

Know the Hierarchy of HOA Governing Documents and Statutes.

To aid in the interpretation of conflicting documents, there is an established hierarchy that must be understood in order to know which provisions have priority over others. The hierarchy of authority for the application of statutes and the provisions contained in an associations governing documents is as follows:

  1. Law (unless the particular statute defers to governing documents)
  2. CC&Rs
  3. Articles of Incorporation
  4. Bylaws
  5. Rules & Regulations

Understand the Common Rules of Interpretation.

Court case decisions frequently pertain to the interpretation of a homeowners associations governing documents, and in particular the associations CC&Rs. Such decisions have established the following common rules for interpreting governing documents:

  • Written instruments should be interpreted according to the generally accepted canons of interpretation so that the purposes of the instrument may be given effect.
  • CC&Rs are interpreted according to the usual rules applied to the interpretation of contracts.
  • CC&Rs should be interpreted with a view toward enforcing the reasonable intention of the parties.
  • Words should be interpreted in their ordinary and popular sense unless a contrary intent is shown.
  • CC&Rs are to be interpreted so as to give effect to the main purpose of the CC&Rs and avoid an interpretation which will make the CC&Rs extraordinary, harsh, unjust, inequitable or which would result in an absurdity.
  • CC&Rs must be considered as a whole and construed in context rather than interpreting a provision in isolation.
  • Language that is clear and explicit and which does not involve an absurdity, governs.
  • When there are two inconsistent provisions concerning the same matter, the more specific provision controls over the more general provision.

Conclusion

Association homeowners, officers, directors, and management personnel should have an understanding of the forgoing rules that relate to the manner in which HOA governing documents and associated state statutes must be interpreted and conflicts that are not clearly resolved by an application of the rules should be taken up with legal counsel for the association. In the final analysis, when the proper interpretation of an associations governing documents remains unclear, it becomes an issue of law that must be decided by a court having jurisdiction over the association.